Monday 12 October 2009

Weak Prospects

BOTTOM LINE: Upside for risk and related assets is limited. Market is very close to a top in risk and a bottom in USD.

Most G7 markets now breached their September highs. I believe this completes their upward structures from October lows. It is highly likely that it also completes their upward structures from August lows. With the said breach, equity markets look better for a sustained decline than they did had they fallen from directly from September highs.

Time to start building shorts.

Below is an hourly chart of SP500 futures. While the move from green "4" to the green "5?" along the projection in thin green (drawn a week ago) could be but the first wave of the final fifth wave, it is worth treating it as the final one in its entirety.

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